REO Sales Still About Double What They Were Pre-Crisis
If sales of real estate owned (REO) properties are any indication, it appears that the number of completed foreclosures is “stuck” at about double the rate seen pre-crisis.
Black Knight Financial Services’ Mortgage Monitor report released in September shows that distressed sale activity (REO and short sales) accounted for about 7% of all residential transactions in the second quarter – and although this is the lowest such share in nine years, it is more than twice the “normal” market level of just over 3% seen pre-2007.
The majority of distressed sales taking place in the market today – roughly two-thirds – are REO sales, according to the report.
Interestingly, the discount purchasers got on short sales decreased to a national average of 21%, while the discount purchasers got on REOs increased slightly to 27%.
The trend toward deepening REO discounts is likely due to the geographic shift in transactions from areas where discounts are lower – such as Florida, with an average REO discount of 23% – to areas where they are steeper.
The largest REO discounts over the first six months of 2016 were in the Northeast and Rust Belt states.
Ohio led the nation, with a 44% average discount on an REO over a traditional sale, followed by New Hampshire and New York, with 41% discounts.
The smallest REO discounts were found in the Southwest, with Texas (14%) and Nevada (16%) seeing the lowest of all.
Mortgage Contracting Services Acquires Lenders Title Solutions
Mortgage Contracting Services (MCS) is becoming an even more complete mortgage services company now that it has acquired Clearwater, Fla.-based Lenders Title Solutions, a national provider of title insurance and settlement services.
MCS, which has been growing through acquisition as of late, already offers property preservation, inspections, REO property maintenance and valuations for the financial services industry on a nationwide basis. In April, the company announced that it had acquired Austin, Texas-based EPIC Real Estate Solutions. That acquisition expanded MCS’ services to include title insurance, escrow and closing, loan document signing, and flood certifications. EPIC also provided a full suite of valuations products.
Prior to that, in 2014, the company announced the acquisition of certain CoreLogic business units, including products that cover valuation in both the loan origination and default service sectors.
“Lenders Title Solutions provides an unsurpassed level of customer experience and superior products and services for its clients,” says Chad Mosley, chief operating officer of MCS Solutions, in a release. “The company will make a great addition to our business, and I believe we both will grow stronger as a result of the combination.”
Exceleras Introduces Software Platform For REO Offering
Exceleras, a provider of Web-based automated tools to manage and value real estate owned properties, has announced that DispoSolutions is now a core element of a new services and technology offering for nonprofit community organizations through a partnership with M2 Asset Services LLC.
According to Exceleras, the result is a complete default and asset management solution that will allow nonprofits to manage real estate, giving them the power to acquire, rehabilitate and sell real estate to rebuild their communities.
“For the first time, community-based organizations will have the power and the connections required to heal neighborhoods. If used correctly, the new platform could even make these organizations self-sufficient – but that’s just the beginning,” says Michael Harris, president and CEO of Exceleras.
“From our perspective, this is a great opportunity for individual real estate investors to participate in the rebuilding of our communities and earn a good return while doing it,” says Donald Maxwell, managing partner at M2 and former director of Fannie Mae’s National Property Disposition Center.
“This new approach accomplishes two things,” he adds. “First, it allows nonprofits to make more money with their services by having scale and access to the funding required to acquire these properties from sellers, like so many cities that currently own them. Secondly, it puts more people who deserve to be homeowners into homes of their own.”
Maxwell says that giving nonprofits control of the assets and then equipping them with a national network for the financing, preservation, rehabilitation and marketing of those assets is a win for all stakeholders.
M2 is currently operating pilots with its new platform in Michigan, Texas and Georgia. Maxwell says the system is working, and the new model may soon be expanded to other communities across the country.
Equator Launches New Suite Of Tools To Help REO Agents
Default servicing solutions provider Equator recently launched a new suite of tools for real estate owned (REO) real estate agents that adds transparency and actionable insight to the REO market.
Dubbed Equator Agent Elite, the new suite gives agents access to Equator’s local REO market insights – visual data and analytics on Equator REO inventory from the nation’s top servicers. This county-level data gives agents powerful insight into their local market dynamics and is in addition to the national/regional-level reporting currently available.
The suite also includes a tool delivering real-time notification of uploaded REO assets. Now, agents can receive real-time notifications when new REO properties are available on Equator and proactively communicate to the servicer or asset manager their interest in marketing the listing of any of the properties.
There’s also a tool to help agents with platform workflow training. The REO training and certification tool provides detailed instruction on key servicer workflow, REO and short sale features, complete with industry terms and information.
Combining in-depth online training modules with rigorous tests, Equator agent certification is a powerful knowledge and marketing tool for any agent, the company claims in a press release. Once agents complete the training, they receive an Equator certification badge on their personal profiles, displayed on the Equator platform.
These tools and market intelligence will help REO agents grow their businesses and gain a competitive advantage in today’s data-driven REO marketplace, the company claims.
“Empowering progressive REO real estate agents with actionable local insights and improved REO marketplace tools benefits our servicers, as well as agents,” says Michael C. Schreck, senior vice president of Equator, in a release. “By arming agents with local market intelligence and servicer certification requirements, agents can become more attractive to the country’s top servicers, who want their assets marketed more effectively to deliver improved return on investment.”